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2015 DIGILAW 1726 (KER)

Ramankutty v. Pareed Pillai

2015-12-23

ANIL K.NARENDRAN, P.R.RAMACHANDRA MENON

body2015
ORDER P.R. Ramachandra Menon, J. 1. Does the law declared by a Full Bench of this Court in Augustine v. Ayyappankutty (1015 (2) KLT 139 (F.B.)) stand correct, in declaring that absence of 'Permit or 'Fitness Certificate' to the transport vehicle is only a 'technical breach' and not a 'fundamental breach', in so far as it stands contrary to the law declared by the Apex Court in National Insurance Company v. Challa Bharathamma (2004 (3) KLT 454 (SC)) (name of the case has been subsequently corrected as per the Official Corrigendum No. F. 3/Ed.BJ./96/2004 dated 01.12.2004 as National Insurance Company v. Challa Upendra Rao ( (2004) 8 SCC 517 )), For having not made even a reference to the decision of the Apex Court, is not above verdict liable to be declared as 'per incuriam'. Has the Full Bench considered all the relevant provisions under the Motor Vehicles Act, 1998, as to the necessity for having a 'Fitness Certificate' to the vehicle (in view of the public safety), the necessity to have valid 'Permit', necessity to have 'Certificate of Registration' to ply a vehicle and deemed absence of registration if the vehicle is not having a valid permit/fitness certificate as envisaged under S. 56 of the M.V. Act ? 2. The main point involved in these cases is with regard to the 'right of recovery' given/not given in favour of the Insurance Company, after meeting the liability towards the claimants, for the reason that the vehicle concerned was not having a valid 'Permit' or 'Fitness Certificate', as the case may be. 3. M.A.C.A. No. 2030 of 2015 has been filed by the insured/owner contending that expiry of 'Fitness Certificate' to the goods carriage (lorry bearing No. KL 8 Z 1627) involved is not a 'fundamental breach' on the part of the insured/owner, to have granted the right of recovery in favour of insurer. M.A.C.A. No. 2641 of 2015 is filed by the very same insured/owner, raising similar contention in respect of the Award passed by the Tribunal in the connected case i.e., O.P.(M.V.) No. 862 of 2007, which was jointly tried and decided alongwith O.P.(M.V.) No. 21 of 2008 involved in the former appeal. In M.A.C.A. No. 1414 of 2013, the claimants in respect of the very same accident (which was the subject matter of O.P.(M.V.) No. 21 of 2008 of the M.A.C.T., Irinjalakkuda) seek for enhancement of compensation. In M.A.C.A. No. 1414 of 2013, the claimants in respect of the very same accident (which was the subject matter of O.P.(M.V.) No. 21 of 2008 of the M.A.C.T., Irinjalakkuda) seek for enhancement of compensation. M.A.C.A. No. 2202 of 2015 has been filed by the Insurance Company, on various grounds, challenging the liability mulcted upon them, despite the denial of existence of valid policy; that the driver was not having valid driving licence; and that the concerned auto rickshaw was having no valid 'Permit' or even a 'Fitness Certificate'. 4. The main contention raised by the appellant in M.A.C.A. No. 2020 of 2015 and M.A.C.A. No. 2641 of 2015 is that, in respect of the vehicle concerned therein, the only insinuation is that there was no 'Fitness Certificate', which according to the said appellants is not a valid ground of defence for the Insurance Company, as provided under Section 149(2) of the Act. The learned counsel also pointed out that the issue. actually stands covered in favour of the insured/owner, by virtue of the ruling rendered by a Full Bench of this Court in Augustine v. Ayyappankutty (cited supra) to the effect that absence of 'Permit' or 'Fitness Certificate' cannot be a valid ground of defence for the Insurance Company. 5. It has come to the notice of this Court that the above judgment happened to be rendered by the Full Bench unfortunately without making a reference to the law already rendered by the Apex Court on the point, with reference to the absence of 'Permit' and the consequences resulted therefrom, as per the decision reported in 2004 (3) KLT 454 (SC) (cited supra). It was a case where a contention was raised from the part of the concerned respondent to the effect that there was no 'permit' for the transport vehicle involved therein and as such, 'violation of any condition of permit' would not arise. The said contention was repelled by the Apex Court, observing that a person who is having no permit cannot stand on a better pedestal than a person who is having a permit, but has violated the conditions in the permit. It was held by the Supreme Court that absence of valid permit is a sufficient and valid ground for the Insurance Company to contest the matter. It was held by the Supreme Court that absence of valid permit is a sufficient and valid ground for the Insurance Company to contest the matter. Scope of contest with reference to S. 170 of the M.V. Act and the eligibility of the Insurance Company, who has already been made party to the proceedings, as explained by the Apex Court in United India Insurance Company Limited v. Shila Datta (2011 (4) KLT 378 (SC)) is also relevant in this context. 6. With regard to the decision rendered by the Full Bench, holding that expiry of the 'Permit' of a vehicle will not enable the insurer to get the right of recovery from the insured; it is really sad that no effort was taken by the parties on both the sides to bring the position of law/binding precedent as on date, to the notice of the Full Bench, when the said judgment was rendered. Way back in the year 2004 itself, the law was laid down by the Apex Court as per the decision reported in 2004 (3) KLT 454 (SC) (cited supra) holding that, absence of valid 'Permit' on the date of the accident, is a valid ground of defence for the insurance company under Section 149(2)(a)(i)(c) of the M.V. Act. The observation of the Supreme Court in paragraph 12 is very relevant; hence it is extracted below: "12. High Court was of the view that since there was no permit, the question of violation of any condition thereof does not arise. The view is clearly fallacious. A person without permit to ply a vehicle cannot be placed at a better pedestal vis-a-vis one who has a permit, but has violated any condition thereof. Plying of a vehicle without a permit is an infraction. Therefore, in terms of S. 149(2) defence is available to the insurer on that aspect. The acceptability of the stand is a matter of adjudication. The question of policy being operative had no relevance for the issue regarding liability of insurer. Plying of a vehicle without a permit is an infraction. Therefore, in terms of S. 149(2) defence is available to the insurer on that aspect. The acceptability of the stand is a matter of adjudication. The question of policy being operative had no relevance for the issue regarding liability of insurer. High Court was, therefore, not justified in holding the insurer liable." The contention put up before the Supreme Court, that no violation of any of the conditions of the 'Permit' was involved (as no permit was in existence), was rejected by the Apex Court, holding that person having no permit could never be placed above a person who is having permit, but has violated some of the conditions contained in the permit. The said decision was never brought to the notice of the Full Bench by either side, leading to mis-declaration of law already declared by the Apex Court. 7. The Motor Vehicles Act 1988, of course, is a beneficial statute which requires wider interpretation, as made clear by the Apex Court in 'Paragraph 65' of the judgment rendered in National Insurance Co. Ltd. v. Swaran Singh (2004 (1) KLT 781 (SC)). But the question is whether such wider interpretation is intended for extending benefits to the victim or to provide any unlawful gain to wrong doer/owner or driver who operates/drives the vehicle in violation of the relevant provisions of law. The question whether absence of "Fitness Certificate' or valid 'Permit' is a 'technical breach' or a 'fundamental breach' has to be considered in the above background. 8. Taking a cue from the observations made by the Apex Court in Swaran Singh's case (cited supra) in dealing with the effective driving licence as discussed in 'paragraphs 81 and 82' of the said judgment, it can be said that there is an ocean of difference between a technical breach and a fundamental breach. The points raised by the appellants/insurers before the Apex Court in Swaran Singh's case (cited supra), the objection raised by the opposite side, the finding given by the Apex Court and the circumstances under which judgment was rendered etc., have been discussed in detail in the order of reference (doubting the correctness of the decision of the Full Bench of this Court in National Insurance Company Ltd. v. Jisha K.P. & Ors. ( 2015 (1) KLT 1 (F.B.)) as reported in 2016 (1) KLT 1 (Shaji v. Pradeesh). An observation has been made by the Apex Court in the above verdict (in Swaran Singh's case (cited supra)), in relation to the effective and valid licence, pointing out that, if the person concerned is having driving licence to drive a light motor vehicle/car, he can drive any other light motor vehicle/jeep, for which no separate licence is necessary. Similarly, if the person concerned is having a valid 'permit' to operate the transport vehicle in a particular route and he operates the vehicle beyond the route not covered by permit and there occurs an accident while in such operation, it may be contended as a technical breach and not fundamental breach. Almost similar will be the position, if the insured carries more passengers in the transport vehicle than the seating capacity mentioned in the 'permit' or more goods in a goods carriage, than the load permitted to be carried; when it may be contended as a technical breach. But if the person concerned does not have any permit at all or if he violates mandatory conditions in permit in using the vehicle (carries passengers in a goods vehicle) or uses goods carriage for transporting passengers, it is a clear breach of S. 149(2)(a)(i)(c) of the Motor Vehicles Act, more so in view of the law declared by the Apex Court as per the decision reported in 2004 (3) KLT 454 (SC) (cited supra). 9. Coming to the question of 'Fitness Certificate', the matter assumes more significance and it is to be more stringent, in so far as public safety of the passengers and pedestrians/other persons using the road is put to stake, more so, since the vehicle, unless fit enough, is not supposed to be put on road, merely to fulfill the greed for money, of the owner or workers. A reference to the relevant provisions of the law in this regard is necessary, to have a clear picture. 10. Section 2(31) of the Motor Vehicles Act 1988 defines the term 'Permit', which means a permit issued by a State or Regional Transport Authority or an authority prescribed in this behalf under this Act authorising the use of a motor vehicle as a transport vehicle. 11. 10. Section 2(31) of the Motor Vehicles Act 1988 defines the term 'Permit', which means a permit issued by a State or Regional Transport Authority or an authority prescribed in this behalf under this Act authorising the use of a motor vehicle as a transport vehicle. 11. Necessity to have registration for a vehicle is stipulated under Section 39 of the Motor Vehicles Act 1988; by virtue of which no person shall drive any motor vehicle and no owner of the motor vehicle shall cause or permit the vehicle to be driven in any public place or any other place, unless the vehicle is registered in accordance with Chapter IV of the Act. 12. The registration is liable for suspension under Section 53 of the Act. If the registering authority "has reason to believe" that if the condition of the vehicle is such that its use, in public place would constitute a danger to the public or that it fails to comply with the requirements of this Act/Rules or has been or is being used "without giving valid permit". Cancellation of registration suspended under Section 53 is stipulated under Section 54. 13. Necessity for 'Permit' is stipulated under Section 66 of the Act coming under Chapter V, which declares that no owner of a motor vehicle shall use or permit to use of the vehicle in a public place, whether or not such vehicle is actually carrying any passengers or goods, save in accordance with the conditions of a permit granted or countersigned by a Regional or State Transport Authority or any such other authority authorising the use of the vehicle in that place and in the manner as sanctioned. 14. Coming to the 'certificate of fitness' of transport vehicle, the necessity in this regard is stipulated under Section 56 of the Act, which in crystal clear terms specifies (subject to provisions of Sections56 and 60) that a transport vehicle shall not be deemed to be validly registered for the purpose of Section 39, unless it carries a "certificate of fitness' as prescribed. 15. Section 84 of the Act deals with the general conditions attaching to all permits and Clause (a) stipulates a condition that the vehicle to which the 'permit' relates, shall carry valid certificate of fitness issued under Section 56 and shall at all times so maintained. 16. 15. Section 84 of the Act deals with the general conditions attaching to all permits and Clause (a) stipulates a condition that the vehicle to which the 'permit' relates, shall carry valid certificate of fitness issued under Section 56 and shall at all times so maintained. 16. Section 86(1) of the Act confers power upon the transport authority who has granted the 'permit' to cancel the permit or suspend the same, on some specified grounds; among which clause (a) is in respect of breach involving any conditions specified under Section 84 or of any condition contained in the permit. 17. Using the vehicle in an unsafe condition is an offence under Section 190 of the Act, wherein the penalty has also been prescribed. Separate penalty is prescribed under Section 192 of the Act, if anybody drives a motor vehicle or causes or allows a motor vehicle to be used in contravention of Section 39 i.e., without registration. Similarly, if anyone drives the motor vehicle or causes or allows a motor vehicle to be used in contravention of Section 66(1) (using without permit) or contravenes any of the conditions of permit, separate penalty is provided. 18. Rule 48 of the Central Motor Vehicles Rules 1989 deals with the issue of 'certificate of Registration', which contains a 'proviso' to the effect that Certificate of Registration pertaining to a transport vehicle shall be handed over to the registered owner only after recording the certificate of fitness in Form 39. The validity of the 'fitness certificate' is provided under Rule 62 of the Central Motor Vehicles Rules, 1989. 19. From the above discussions, it is quite evident that the registration of a vehicle, existence of valid permit and availability of fitness certificate all throughout (if the vehicle is a transport vehicle) are closely interlinked and one cannot be segregated from the other. The vehicle should be completely fit to be plied on the road, which otherwise will cause threat to the lives and limbs of passengers and the general public. The vehicle should be completely fit to be plied on the road, which otherwise will cause threat to the lives and limbs of passengers and the general public. Only if the vehicle is having valid 'Fitness Certificate', necessary 'Permit' will be issued, and by virtue of S. 56 of the Act, no transport vehicle without valid Fitness Certificate will be deemed as a validly registered vehicle, for the purpose of S. 39 of the Act and by virtue of S. 39, nobody shall drive or cause the motor vehicle to be driven without valid registration in public place or in any other such place. Similar is the provision with regard to Section 66 as. well, where the necessity for 'Permit' is stipulated. Crux of the legal prescriptions is that, when the vehicle is not having a 'Fitness Certificate', it will be deemed as having no certificate of registration and when the vehicle is not having Permit or Fitness Certificate, nobody can drive such vehicle and no owner can permit use of any such vehicle compromising with lives and limbs of the passengers and the general public. Since the safety of passengers and the general public was of much concern and consideration of the law makers, adequate provisions have been incorporated under the Statute, providing the circumstances which constitute offence, also prescribing penalty. This being the position, such lapse, if any, can only be regarded as a 'fundamental breach' and not a technical breach. We respectfully disagree with the declaration made by the Full Bench without making a reference to the above provisions especially Sections 84 & 86 of the Act and Rules 48 and 62 of the Central Motor Vehicles Rules, but for making a reference to 'Rule 82' of the Central Motor Vehicles Rules, which in fact deals only with Tourist Permits'. This is more so, since the law declared by the Full Bench stands diametrically opposite to the law declared by the Apex Court as per the decision reported in 2004 (3) KLT 454 (SC) (cited supra) in relation to the violation of condition/absence of valid permit. 20. This is more so, since the law declared by the Full Bench stands diametrically opposite to the law declared by the Apex Court as per the decision reported in 2004 (3) KLT 454 (SC) (cited supra) in relation to the violation of condition/absence of valid permit. 20. In view of the law declared by the Supreme Court, which is the law of the land by virtue of Article 141 of the Constitution of India, we are bound to follow the said verdict passed by the Supreme Court, instead of the one rendered by the Full Bench of this Court (cited supra), which may have to be declared as 'per incuriam'. But in so far as the judgment rendered by the Full Bench stands, notwithstanding the verdict to the contrary passed by the Apex Court much earlier, and if the decision is liable to be declared as "per ineurium', the question is whether the Full Bench decision could be followed by the Tribunals and other courts. The position has to be made clear by a Bench of appropriate strength, in the light of the relevant provisions of law and the verdict passed by the Apex Court as mentioned above. So as to cause the matter to be considered accordingly, it has become essential to have the matter placed before the Honourable Chief Justice, to be dealt with in accordance with law. It is ordered accordingly. In view of the nature of contentions raised by the parties, particularly the appellants in M.A.C.A. No. 2030 and 2202 of 2015, the steps for recovery at the instance of the Insurance Company, if any, shall be kept in abeyance for a period of three months.